Before buying a policy, a driver should consider the different auto insurance types offered by providers. A basic policy will include coverage to protect the occupants of the other vehicle, the policyholder and his or her passenger, and to cover repairs to the policyholder’s own vehicle.
- Bodily injury liability insurance pays for injuries and lost wages incurred by the occupants of the other vehicle in an accident.
- Property damage liability coverage pays for repairs to the other driver’s vehicle and public property damaged in the accident.
- Uninsured and underinsured motorist insurance pays out when the at-fault driver in an accident does not have insurance or does not have enough coverage to pay for the damages he or she caused. In most parts of the U.S., this policy pays for medical expenses only, but it is possible to get coverage to pay for property damage as well.
- Medical payments coverage is put in place to pay for the medical bills and related expenses incurred by the policyholder and the occupants of his or her vehicle. It is usually required in no-fault car insurance states, and drivers who have a good level of medical insurance coverage in place may want to limit this protection to the minimum required under state law.
- Collision coverage covers the policyholder’s own vehicle and pays for damages incurred as the result of striking an inanimate object.
- Comprehensive protection comes into play when the damage to the vehicle is caused by an event other than a collision. It pay for damage caused by severe weather, fire, falling objects and theft.